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Laos: Savannakhet faces fuel shortage
Savannakhet province is facing an acute fuel shortage making it difficult for people to commute.
Addressing the issue, the Director of the Department of Industry and Commerce of Savannakhet Province, Mr Phosysoy kuthilath, told the local media that fuel prices have been steadily rising, with oil prices having fluctuated 11 times since early 2022. The reason for rising oil prices is due to the ongoing conflict between the world’s oil-producing countries.
Therefore, oil-importing countries, including Laos, have been affected. Moreover, the increase in import duty for foreign goods has resulted in a large demand for foreign currency.
When the foreign currency is in high demand, it results in the depreciation of the kip. The source of foreign currency (dollar) provided to the business sector to buy oil, is not enough to meet the needs of the country.
Laos had 13 companies that imported oil, now there are only four companies that are importing oil, thus affecting the import of fuel. The import of oil has decreased while the demand is higher.
The import of oil, especially gasoline, is not enough to meet the demand, making many gas stations run out of oil.
Mr Phosysoy urged the government to take emergency measures to reduce taxes and duties to enable importing companies to import more oil.
According to the Head of the Lao Petroleum Enterprise, Savannakhet branch, Mr Padinsin Razmountry, oil imports since early 2022 have been down – from 18 percent in February to 24 percent in April.
Experts in the energy sector warn that if the world’s oil-producing countries continue to be at loggerheads and there is a lack of foreign currency to pay for imported oil, Laos will continue to face a shortage in the domestic market, which in turn affect the cost of living.
In March, government bodies had been told to revise the price structure of fuel to minimise the impact on the economy as well as ease the financial burden on ordinary people.
Regulating the price of fuel is part of the government’s national agenda to address economic and financial difficulties.
Source: https://www.vientianetimes.org.la/freeContent/FreeConten85_Savannakhet_22.php